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11
Higher education in Virtual Worlds- Industry and Competitor Analysis in Europe/US
Group 3a February 7, 2011
22
Higher Education in VWs
Case Study VWET
Industry Analysis
Conclusions, thoughts and recommendations
References
Contents
44
Higher Education in VWs - General Information
• Higher Education in Virtual 3D Worlds
• Higher Education in Virtual World’s can be divided into two main strategies based on the platforms:
Virtual Worlds with optional eLearning
possibilities
Virtual Worlds that have eLearning as their single
purpose
e.g. Second Life e.g. OLIVE
Non-specialized Specialized
Sponsor interviews
Higher Education in VWs - Value chain
Internet Server
Software
3D VW Platforms
Org with education
and/or training
Recipients
5
• Second Life• Active Worlds• OLIVE
• OpenSimulator• Croquet Consortium
• Universities• Governments• Organizations
• Students• Employees
“Support-centered companies focused on helping universities, organizations and other institutions for educational and business usage of virtual 3D environments”
• ReactionGrid• 3rd Rock• VWET
3D VW and
education consultants
Warburtson, S, 2009; OpenSim Grids; 3D Virtual Worlds List
6
Case Study: Virtual World Education Technologies (VWET)
“Virtual Worlds are still new, they are still developing, people are still not comfortable with it” (quote J.F.)
“ESMG/VWET offers the kind of service and support that makes thetransition from real life to virtual life almost effortless”
• Support-centered company
• Use SL as one of their environments
• Designed own platform as well, making them a VR provider
• Currently support some of the most forward thinking institutions in SL
• Biggest competitive advantage: “Clients are still acquired face-to-face, not only
virtually”
• Committed to providing the highest quality environment and support for
educators working to provide educators with a viable option to current platforms
Sponsor interviews, http://www.virtualworlded.com/
7
Industry Analysis – Porter’s Five Forces
7
Buyers• Universities• Organizations• Governmental
institutions
Bargaining Power of Buyers(-) More buyers than sellers(-) Quality vital for the buyer(-) High switching cost(-) Seldom negotiate(+) Possibility of backward integration (create own
platforms)(+) Complementary element (Change in the future)
Suppliers• VW Platforms• Open source
frameworks
ME
DIU
M
Bargaining Power of Supplier(-) High ability by industry buyers to do backward
vertical integration (create own platforms)(-) Supplied products (platforms) are
undifferentiated(-) Many suppliers
LOW
Sponsor interviews, Porter (2008)
8
Industry Analysis – Porter’s Five Forces
8
Substitutes• 2D-platforms• E-learning
(-) Low capital requirements(+) High switching cost for buyers(-) Low product differentiation(-) No legal/regulatory Barriers(+) A few companies have a first mover
advantage likely to change
Threat of Substitutes(+) Similar functions(+) Socio-cultural beliefs
(Traditionalism)
Barriers to Entry• Relationships• Knowledge/
know how
HIG
HM
ED
IUM
Sponsor interviews, Porter (2008)
9
Industry Analysis – Porter’s Five Forces
9
Rivalry (+) Equally balanced competitors(-) High industry growth(-) Low fixed costs low exit barrier(-) Possibility of strategic
differentiation in strategy(-) High profit potential
LOW
:Sponsor interviews, Porter (2008)
11
Industry Analysis – Overview
11
Bargaining Power of Suppliers
Threat of Potential Entrants
Bargaining Power of Buyers
Threat of Substitutes
Rivalry Between Competitors
Political
Economic
Socio-cultural Traditionalism
Technological
Environmental
Legal
Bargaining Power of Suppliers
Threat of Potential Entrants
Bargaining Power of Buyers
Threat of Substitutes
Rivalry Between Competitors
Socio-cultural Social media integration new types of competitors
Large accep-tance for VW and distance learning
Improved attitute for VW interaction /social media int.
Industry growth make room for more players
Technological Higher demand for suppliers’ high-tech
Tech dev. will make it more accessible and attractive
Higher user requirements on prestanda, mobility, etc
Lower demand for substitutes mentioned
Newtypes of competitors, wide-spread usage of tech
Economic Somewhat affected by national GDP
Tuition fees rising
Unsure effect
Environmental Increasing environmental consciousness
Promotes industry growth
Political EU-wide investments in R&D
Joint effort within EU on bandwidthLower barriers
More competitive landscape
Sponsor interviews, Internet sources; STEEP
12
Industry Analysis – Key Success Factors
12
What do users want? How do we survive competition?
KEY SUCCESS FACTORS
- Good understanding of institution/organization
- Ease of use- Adaptability- Proximity to IRL
relationships to peers, teachers etc.
- Social media/ OER integration- Good use of mobile internet devices- Relevant contacts/ networking- On LT, develop a strategic focus
Sponsor interviews, http://www.pjb.co.uk/npl/bp34.htm
- Technical functionality- Training of/
communication with buyers
- Acknowledgement among institutions for higher education
13
Industry Analysis – Future Predictions
Learning, social interaction and entertainment´become integrated
Growing share of user-generated content and platforms where educators
can build their own environment
Freemium models/ larger proportion of free material
http://www.googleartproject.com, Sponsor interviews
1414
Conclusions
- Applying Porter’s 5 Forces and a STEEP analysis on the industry for Higher Education in Virtual Worlds reveals its rising importance and potential of growth
- While the threat of substitutes is high, the bargaining power of buyers and the barriers to entry can be categorized as medium
- Rivalry within the industry and the bargaining power of suppliers (VW platforms) on the other hand, appear to be relatively low indicating potential for companies involved
- This is supported by the STEEP analysis which reveals support amongst all factors (e.g. future technological developments and social acceptance of VW:s)
- Therefore it can be concluded that Higher Education in Virtual Worlds will play an important role in future learning and – as an industry – offers opportunities of profitability
1515
Sources
• Warburtson, S; Second Life in higher education: Assessing the potential for and the barriers to deploying virtual worlds in learning and teaching, British Journal of Educational Technology, Vol 40 No 3, 2009
• Interview John Fennessy, 2011-01-31• Interview Jeroen van Veen, 2011-01-28• Interview Steve Mahaley, 2011-02-04• Interview Erik Wallin, 2011-02-02• http://www.virtualworlded.com• OpenSim Grids, http://arianeb.wordpress.com/2010/04/11/open-sim-grids/, 2011-02-05 • 3D Virtual Worlds List, http://arianeb.com/more3Dworlds.htm, 2011-02-05• http://www.pjb.co.uk/npl/bp34.htm• Porter, M.E., “The Five Competitive Forces that Shape Competitive Strategy”, HBR, 2008.
STEEP• http://www.pjb.co.uk/npl/bp34.htm 2011-02-05 • http://www.budde.com.au/Research/European-Telecommunications-Infrastructure-and-NGNs.html 2011-
02-05 • http://epp.eurostat.ec.europa.eu/cache/ITY_OFFPUB/KS-QA-10-050/EN/KS-QA-10-050-EN.PDF 2011-
02-05 • http://www.reuters.com/article/2009/08/31/us-europe-mobile-idUSTRE57U1IQ20090831 2011-02-05 • http://www.eua.be/fileadmin/user_upload/files/Newsletter_new/economic_crisis_19052010_FINAL.pdf
2011-02-05 • http://ec.europa.eu/public_opinion/archives/ebs/ebs_313_en.pdf 2011-02-05 • http://ec.europa.eu/public_opinion/archives/ebs/ebs_313_en.pdf 2011-02-05 • http://www.siliconrepublic.com/innovation/item/17956-eu-makes-massive-780m-inve 2011-02-05
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